How big is the teacher pay offer in England?

In March 2023, the government increased its average pay offer to teachers in England from 3.5% to 4.5%, plus a one-off bonus of £1,000. This offer was rejected by teaching unions and many teachers are on strike today. In this short briefing, we analyse the offer made by the government, the extra funding available, and how it affects the long-term picture on school funding and teacher salaries.

The government’s updated pay offer is only part-funded. It has offered to pay the full cost of a one-off £1,000 bonus, but it will only pay half the cost of an extra 1% on pay settlements, with schools expected to fund the other half from existing budgets. Making the offer fully funded would only cost about £150m.

The higher salary offer is just about affordable for most schools. Even with the higher teacher pay offer, we still expect total school funding to be growing faster than costs for most schools this year and next. The extra 0.5% on teacher pay awards to be found within existing school budgets only comprises about 0.25% of annual school spending.

With or without any extra funding, the underlying position on school funding and teacher pay is basically unchanged. School funding will still be about the same level in real-terms in 2024 as it was in 2010, and most teacher salaries in 2023 will be about 12% lower in real-terms than in 2010.

Luke Sibieta, Research Fellow at the Institute for Fiscal Studies said:

‘The government has increased its average pay offer to teachers in England from 3.5% to 4.5%. This is half-funded, with schools expected to cover about £150m of the long-run cost from existing budgets. This is just about affordable for most schools, but it’s a tight picture and it certainly won’t be affordable for all schools.’

‘The long-run picture on school funding and teacher pay is also largely unchanged. School funding per pupil is currently due to get back to 2010 levels in real-terms by 2024, with no overall growth in school funding over 14 years. Even with the higher pay offer, most teacher salaries will still be about 12% lower in real-terms than in 2010.’